Influence of Globalisation on Organisational Governance and Leadership, Structure, Culture and Functions

Global Business
Environment

INTRODUCTION
The global business environment is mainly the representative of an environment exits in
different sovereign countries including various internal and external factors like suppliers,
customers, value chain, competitors, political, legal and many other factors that are exogenous to
home or domestic environment of a company (Adekola and Sergi, 2016). Global business
environment is a result of enhancement in integration among nation and economy that has
facilitated many opportunities for an organisation through providing reach to a wider market area
and more customers. But at the same time many threats and issues associated with higher
competition level and other dynamic factors are also caused by this. This assignment is based on
CM Downton Ltd that is a privately owned logistics firm and has established itself in highly
competitive industry through fulling needs and desires of customers in most effective way. This
report includes a discussion about key factors that drive globalisation together with its strategic
complexities. Further an evaluation about influence of globalisation on organisations structure,
culture and function is also their together with its influence on decision making and strategy.
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P1) Analysis of key factors that drive global commerce
Concept of globalisation or global commerce
The concept of globalisation is mainly associated with the increase in integration and
interconnection among nations and culture that has facilitated better opportunities for
international business. The global commerce has facilitated wider market and increase in
customer base that is beneficial for an organisation to earn better profits and increase its
productivity (Ali and Khan, 2019). Thus, CM Downton Ltd is also having an opportunity to
improve its customer base and earn higher profits through expanding its business operation at
international level. The main drivers and key factors that encourage CM Downton Ltd to expand
its business operations at global level are as follows:
Cost- It act as a key factor that drive global commerce and trade as operating at
international level makes operations more cost effective through improving the overall
productivity. For instance, when CM Downton Ltd operate at global level it need to order raw
material and other inventory in large quantity that reduce the cost of stock as procured in bulk
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quantity, thus, cost efficiency is one of the key factor that entourage CM Downton Ltd to
operate at global level.
Market- The other factor that encourages an organisation to operate at global level is
enhancement in market share and customer base. For instance, CM Downton Ltd when starts
operating at global level its market share get enhanced as it become able to attract more
customers from different nations and localities thus, improve its productivity and profit margin.
Thus, enhancement in market share is also a key factor that drive global trade and commerce.
Competition- while operating at global level an organization get better opportunity to attract
more investors in form of FDI thus, lead to enhancement in its competitive strength and business
position. CM Downton Ltd can also enhance its competitive power through expanding its
business operations at global level (Berman and Dalzell-Payne, 2018).
Beside these factors, use of PESTEL analysis are also made by CM Downton Ltd before
expanding its business operation at global level as it provide better analysis of external threats
and opportunity that act as drivers of global trade and commerce.
Political- It includes the level of political stability and attitude of political parties towards
business organisation. The nations that have higher level of political stability crate opportunity
for CM Downton Ltd as it facilitates ease in logistic operation and its function.
Economical- It is mainly associated with growth rate, inflation and deflation, GDP,
consumable income, etc. A developing country offer better opportunity for CM Downton Ltd as
it facilitates higher level of purchasing power of customer and facilitates better growth rate for
logistic operations.
Social- It is mainly related with the attitude, behaviours of customer together with
cultural and social norms of a nation (Colpan and Jones, 2019). It act as driver of global trade as
organisation like CM Downton Ltd needs to make its business policies and strategies as per the
behaviour and preference of society in which it operates thus, shape and influence its business
operations.
Technological- It is that factor associated with level of technology and advancement that
prevails in nation. It is one of the key factors that motivates CM Downton Ltd to operate at
global level as it facilitates better reach and assess to more effective and latest technology in
order to have improvements in its business operations together with enhancement in productivity
and profitability.
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